HomeMy WebLinkAboutC-7833-3 - MOU (for Rule 20A Funds)MEMORANDUM OF UNDERSTANDING
This Memorandum of Understanding ("MOU") is entered into as of August 25, 2020
("Effective Date"), by and between the City of Newport Beach, a California municipal
corporation and charter city, with its principal place of business at 100 Civic Center Drive,
Newport Beach, California 92660 ("Newport Beach"), and the City of Monrovia, a
California municipal corporation with its principal place of business at 415 S. Ivy Avenue,
Monrovia, California 91016 ("Monrovia"). Newport Beach and Monrovia are sometimes
individually referred to herein as "Party" and collectively as "Parties".
RECITALS
A. Electric Utilities collect and annually allocate funds to communities to
convert overhead electric facilities to underground electric facilities ("Rule 20A Funds").
B. Newport Beach is actively planning one or more projects to underground
overhead electric facilities that qualify for the application of California Public Utilities
Commission ("CPUC") Rule 20A Funds ("Projects"). Newport Beach desires to obtain
additional Rule 20A Funds allocation to finance such Projects.
C. Southern California Edison ("SCE") currently has designated and dedicated
a balance of Four Hundred Thirty Seven Thousand Five Hundred Sixty Eight Dollars and
00/100 ($437,568.00) in Rule 20A Funds for the benefit of Monrovia ("Monrovia
Allocation"), and Monrovia currently has no active projects which can make use of the
Monrovia Allocation.
D. Newport Beach desires to acquire, for consideration, the Monrovia
Allocation to use in connection with the Projects, and Monrovia desires to transfer the
Monrovia Allocation to Newport Beach to enable the Rule 20A Funds, which have been
allocated to Monrovia, to be used for their intended purpose of undergrounding electric
facilities and to derive economic benefit from the Monrovia Allocation.
AGREEMENT
NOW, THEREFORE, the Parties hereto agree as follows:
1. Monrovia agrees to assign, for use by Newport Beach, its rights and
interests in the Monrovia Allocation to Newport Beach, and Newport Beach agrees to
acquire, for consideration, the Monrovia Allocation in accordance with the terms of this
MOU. This MOU shall be subject to the approval of each the City Council of Newport
Beach and the City Council of Monrovia and shall become effective on the date when
both such approvals have been obtained (Effective Date). Notwithstanding the foregoing,
if this MOU has not become effective as of September 30, 2020, then either Party may
terminate this MOU on five (5) business days' written notice to the other Party without
incurring any liability, costs or further obligations to the other party or any third party.
2. Within fifteen (15) business days of the Effective Date, Newport Beach shall
make a payment to Monrovia in the amount of Two Hundred Forty Thousand Six
Hundred Sixty-two Dollars and 40/100 ($240,662.40) ("Acquisition Price"). The
Acquisition Price shall be made in immediately available funds via check or wire transfer
to an account designated by Monrovia. The Acquisition Price shall constitute full
consideration for the transfer and assignment of the Monrovia Allocation.
3. Monrovia agrees to sell the Monrovia Allocation to Newport Beach at a
purchase rate of Fifty -Five Cents ($0.55) for every One Dollar ($1.00) of Rule 20A Funds.
Within ten (10) business days of Monrovia's receipt of the Acquisition Price funds,
Monrovia shall deliver a written request to SCE, with a copy to Newport Beach, making a
formal request to transfer and assign the entire balance of the Rule 20A Funds contained
in the Monrovia Allocation to and for the benefit of Newport Beach. Monrovia shall
cooperate in good faith with Newport Beach to provide any additional documentation or
information that is reasonably requested by SCE to complete the transfer. In the event
that SCE is unable to complete the transfer, or only complete a partial transfer, Monrovia
shalt return the unused Acquisition Price funds to Newport Beach within ten (10) business
days of Newport Beach's notification to Monrovia.
4. Newport Beach acknowledges and agrees that it has conducted its own
investigation as to the applicability and transferability of the Monrovia Allocation for use
in the Projects and that Monrovia has not made any representation or warranty to Newport
Beach with respect to same. The actual use of the Monrovia Allocation by Newport Beach
shall be subject to the rules and procedures adopted by SCE, CPUC, and such other
conditions or requirements as are set forth in the Public Utilities Code.
5. Newport Beach shall indemnify, defend, and hold harmless Monrovia, its
elected officials, officers, employees, and agents, from any claim, damage or liability
arising in connection with the use of Rule 20A Funds from the Monrovia Allocation in
connection with the construction of the Projects, including legal challenges of all types or
natures, including but not limited to administrative, judicial, or legislative actions.
6. In the event that either Party is in breach of its obligations as set forth in this
MOU, then the non -defaulting Party shall have the right to terminate this Agreement on
ten (10) business days' written notice to the defaulting Party unless the default is cured,
or cure has commenced, within the notice period. Upon termination for breach, the non -
defaulting Party may exercise any right or remedy which it may have under applicable
law. Within ten (10) business days of termination pursuant to this Section 7, Monrovia
shall return to Newport Beach that portion of the Acquisition Price funds applicable to that
portion of the Monrovia Allocation not yet transferred by SCE to Newport Beach.
7. All notices to be given pursuant to this MOU shall be delivered in person or
by commercial overnight delivery to the address of the Party set forth above, and
addressed to the City Manager of such Party and shall be effective upon receipt.
8. This MOU shall be governed and construed in accordance with the laws of
the State of California, and any action brought relating to this Agreement shall be
adjudicated in a court of competent jurisdiction in the County of Orange.
9. Each Party shall at its own cost and expense comply with all statutes,
ordinances, regulations and requirements of all governmental entities, including federal,
state, county or municipal, whether now in force or hereinafter enacted.
10. A waiver by either Party of any breach, of any term, covenant or condition
contained herein shall not be deemed to be a waiver of any subsequent breach of the
same or any other term, covenant or condition contained herein, whether of the same or
a different character.
11. The terms of this Agreement shall be construed in accordance with the
meaning of the language used and shall not be construed for or against either Party by
reason of the authorship of the Agreement or any other rule of construction which might
otherwise apply.
12. If any term or portion of this Agreement is held to be invalid, illegal, or
otherwise unenforceable by a court of competent jurisdiction, the remaining provisions of
this Agreement shall continue in full force and effect.
13. In the event of any dispute or legal action arising under this Agreement, the
prevailing Party shall not be entitled to attorney's fees.
14. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original and all of which together shall constitute one and the
same instrument.
15. Each Party signing this Agreement explicitly affirms and provides they have
the power and authority to bind their respective Party.
[SIGNATURES ON FOLLOWING PAGE]
3
IN WITNESS WHEREOF, the Parties hereto have executed this MOU as of the
dates indicated below.
CITY OF MONROVIA,
A California municipal corporation
Date:
Dylan Fei
City Manager
ATTEST:
Date: Ot - b • ",)0—. -YO
(i-A'ce aAtkins�,MMC
City Clerk
APPROVED AS TO FORM:
Date: O� , to ' *-,)0 )
Craig A. Ste le
City Attorney
CITY OF NEWPORT BEACH,
A California municipal corporation
Date: m
Gra . Leung
Ci anager
ATTEST:
Date: �-
APPROVED AS TO FORM:
Date: 7/g/Zp2o
. & g. A, --
Aaron C. Harp W-0 1-4-W
City Attorney
[END OF SIGNATURES]
rd